European payments and fintech snapshot

Still recovering from the bank holiday and trying to catch up with everything that’s happening in the name of payments and fintech in Europe right now? Look no further. We’ve picked out the most interesting stories happening across the continent right now, so you don’t have to.

1. Berlin neo bank Number26 upsets customers

Highly buzzed Berlin neobank Number26 which calls itsef “Europe’s most modern bank account” upset some of its customers this week after reportedly cancelling their accounts without warning. This followed glitches with the service that saw customers unable to make transactions using their Number26 Maestro or MasterCards. The firm issued a statement on the cancellations, saying only a few hundred customers have been affected and that the number is “insignificant” at the rate it is growing.

​”Number26 is one of the fastest growing checking account providers in Europe. Every provider of financial services has the right to end a customer relationship, as we must also do from time to time. Recent cancellation notices affected a few hundred Number26 accounts. In the context of our fast growth, the number of affected accounts is insignificant. Each cancellation has a reason, and we are sorry to have to close any account. For data protection reasons we cannot comment on specific cases. Notified customers have 2 full months to continue using their accounts under current terms and conditions before the account closure becomes effective.”

The startup might be brushing off the cancellations, but tell that to those affected – many of whom have been venting their frustrations on Twitter.

I love it when companies write passive-aggressive statements blaming their customers and saying we're not important to them @number26

Finnish digital invoicing firm Zervant is inking a deal with ING Belgium, which is part of the wider ING banking group in Europe. The firm says ING has a license to rebrand the invoicing software as its own product and to sell the tool in Belgium. Zervant is aimed at small and medium-sized businesses to help manage their financial documentation and invoicing online. Zervant says it already has more than 100,000 users and that its main markets are Sweden, Finland, Germany, Frank and the UK.

“When it comes to innovation, we strongly believe in collaboration, says Rik Vandenberghe, CEO ING Belgium. The partnership with Zervant allows us to go beyond traditional banking and to respond to the changing needs of our clients.”

Cash isn’t going away any time soon, sure, but do we need to spend money improving the quality of bank notes? Yes, according to the Bank of England, which is going to issue polymer notes this year. The first note to be issued will be the five pound note, which will be available in September, with the £10 note to follow in 2017 and the £20 in 2020. The BoE says polymer notes are cleaner, more durable (therefore reducing print runs) and more difficult to counterfeit than banknotes currently in circulation. However, payments consultancy CMSpi reckons the process will cost businesses an estimated £236m to implement new cash handling technology.

According to CMSpi CEO Brendan Doyle, the cost outstrips the benefit and that with fraudsters increasingly focusing on cyber-attacks the move to make cash more secure is “absurd” and “whimsical”, hitting small businesses hardest.

Less good news for financial tech elsewhere in Europe, with PayPal announcing it is shuttering its business in Turkey as of this month after failing to get the new license it needs to do business there. The firm told TechCrunch that new rules from the local financial regulator, the BDDK, require IT systems to be localised in the country. That doesn’t work for PayPal, which says it has a global platform operating across 200 markets. PayPal says the legislation will affect “tens of thousands” of other businesses. Customers will no longer be able to send or receive funds using PayPal in Turkey, but will be able to log in to withdraw money and transfer them to a Turkish bank account.

5. France’s finance regulator launches fintech task force

Meanwhile in France, the financial regulator Autorité des Marchés has set up a dedicated unit that will focus on fintech, innovation and competitiveness. It will be headed up by Franck Guiader, formerly at NYSE Euronext and BNP Paribas who will lead a team looking at how new technology is impacting on the financial services industry. The team will also be making sure that regulation in France is relevant in a time of rapid innovation and technological development.

6. Glasgow Subway goes digital

Glasgow’s subway ticketing system is going digital, with 100,000 new Bramble travel cards now in circulation. The cards are issued as a joint venture between Strathclyde Partnership for Transport (which runs the metro and specialist buses in the Scottish city) and smart travel tech firm Ecebs that now belongs to tech firm Rambus.

“The future of transport will rely more on smart integrated ticketing as our customers demand more convenience and ease of travel,” says Eric Stewart, SPT assistant chief executive. “Public transport operators are looking to work together to ensure journeys become as easy and simple as possible for passengers, and increasing the adoption of smart technology is key to achieving this.” [Read More]